Monday, December 28, 2009

The Recession Begins Flooding Into the Courts

New York State’s courts are closing the year with 4.7 million cases — the highest tally ever — and new statistics suggest that courtrooms are now seeing the delayed result of the country’s economic collapse. The Great Recession may be showing signs of easing, but the legal fallout from the financial troubles, the numbers suggest, may have only just begun.

And the increase in New York offers a preview of the recession-related cases showing up in courts across the nation.

New York’s judges are wading into these types of cases by the tens of thousands, according to the new statistics, cases involving not only bad debts and soured deals, but also filings that are indirect but still jarring measures of economic stresses, like charges of violence in families torn apart by lost jobs and homes in jeopardy.

Contract disputes statewide in 2009 are projected to be up 9 percent from the year before. Statewide home foreclosure filings increased 17 percent, to 48,127 filings. Cases involving charges like assault by family members were up 18 percent statewide. While serious crime remains low, misdemeanor charges in New York City were up 7 percent and lesser violations were up 18 percent in 2009.

Judges and lawyers say the tales behind any number of cases, including low-level offenses like turnstile jumping and petty theft, are often a barometer of bad times. And they said that the data showed that courts nationally would be working through the recession’s consequences for years, much as they did with the flood of cases stemming from the crack cocaine epidemic of the 1980s, even after the epidemic had slowed.

For most court systems nationally, official tallies of cases filed since the 2008 economic collapse are not yet complete. But the New York data, compiled by state court officials after a request from The New York Times, provide an early measure of the wave of recession cases nationally.

Florida officials say there were some 400,000 foreclosure filings there this year, an increase of 446 percent since 2006. In Arizona, officials say eviction cases have tripled in the last year, contract disputes are up 77 percent over the last two years, and there is a notable increase in cases seeking to commit people for mental health treatment because of stress-related conditions.

“The New York experience is representative. That’s what we are seeing here,” said John T. Broderick Jr., the chief justice of New Hampshire’s Supreme Court, adding that many divorce, petty crime and domestic violence cases seem to have their roots in financial troubles.

Steve C. Hollon, an Ohio court official who is president of the Conference of State Court Administrators, said court officials nationally had noticed a growing number of people saying their circumstances were so desperate that they could not afford lawyers, turning virtually every kind of case into a journey through the economy’s rough edges.

The new statistics in New York show the breadth of the recession-related cases — in family, criminal and commercial courts and on across the judicial system. The cases turn the courts into theaters of the economic crisis.

Court administrators said it is likely they have seen only the first wave of recession cases because courtroom battles take time to brew. They said they were bracing for more suits over business disputes, foreclosures, evictions and family disputes as the costs of the downturn continued to be revealed.

New York’s projected caseload this year has risen by some 63,000 cases from last year, which would appear to be a modest increase. But court administrators say the broad impact of the recession is clear in hundreds of thousands of new cases across the judicial system, including people challenging their real estate taxes, home foreclosures, contract disputes and family offenses. The 17 percent increase in statewide home foreclosure filings, for example, is part of an 84 percent climb over the last four years, to nearly 50,000.

The city’s Civil Courts, where suits seeking less than $25,000 are heard, have seen caseloads balloon to more than 577,000 this year, from about 200,000 10 years ago. Court administrators say much of the increase is because of suits over unpaid credit card bills.

“Until you’re standing amidst 40 people who are worried about losing their homes, you can’t really appreciate how significant the whole downturn was,” said Hilary J. Bauer, a lawyer for the Jewish Association for Services for the Aged who represents homeowners facing foreclosure.

Court cases need not be about money to offer a measure of the recession’s impact, said a Family Court judge, Pam Jackman-Brown. From her bench in Queens, she said, every day she sees formerly middle-class families wrenched by anger and fear. A judge, she said, does not always have the answer when family anxiety turns into tussles and shoves, and then into charges of assault or menacing.